Napco posts record first-quarter profit as service revenue grows

Napco Security Technologies reported record fiscal first-quarter 2027 revenue of $50 million, driven by an 11.5% increase in recurring service revenue that offset a decline in equipment sales. The company’s net income rose 6.9% to a first-quarter record of $13 million, or 36 cents per diluted share, while adjusted EBITDA increased 3.8% to $15.5 million.

President and CEO Kevin Buchel attributed the 7.3% drop in equipment revenue to reduced purchases by two locking distributors and a difficult comparison with prior-year sales that benefited from backlog orders ahead of tariff-related price increases. Buchel noted that despite the dip in distributor purchases, sell-through growth remained positive, with one distributor’s orders arriving immediately after the quarter ended.

Recurring service revenue, which generated a 90.1% gross margin, now accounts for 52% of total sales. The company’s prospective annual recurring service revenue run rate reached approximately $106 million based on October revenue, up about $3 million from levels reported in August, primarily driven by StarLink radio fire communicator activations.

Read the full story at securityinfowatch.com.